Multi-billion-dollar potential for Western Australia's carbon farming industry
A new carbon farming pilot project across the Southern Rangelands could signal the start of a new multi-billion-dollar industry for Western Australian pastoralists.
This week the State Government gave approvals for WA pastoralists to participate in the Commonwealth's $2.55 billion Emissions Reduction Fund (ERF) and upcoming reverse auction.
Already established in states such as NSW and Queensland, under the scheme land owners are paid for practices that reduce carbon dioxide emissions, like conserving native vegetation on their land.
Landholders can then earn carbon credits for their practices, which they can sell on the carbon market to companies that want to offset their emission costs.
Agriculture Minister Alannah MacTiernan said she hoped the 12-month pilot program would be the first step towards creating an accessible carbon farming industry in WA.
"Supporting carbon farming is critical to the Government's pastoral lands reform process and will help pastoralists to diversify their activities, improve pastoral condition and support regional jobs," she said.
"We anticipate there will be half a dozen pastoralists who have been working with groups like Select Carbon that will put in applications for this Commonwealth Fund.
"But when we get this thing underway there will be a lot more opportunities lying even outside the Emissions Reduction Fund."
Opening up a multi-billion-dollar industry for WA
One of Australia's largest carbon farming companies Climate Friendly already manages 90 different projects under the ERF in Queensland and NSW.
General manager Josh Harris said with carbon prices on an upwards trend and the next carbon auction only weeks away, it was a good time for WA pastoralists to join the $2 billion carbon farming industry.
"The carbon price is $13 per carbon credit roughly at the last auction, and we actually think the trajectory is looking pretty good for higher carbon prices, so the timing for projects in WA is quite good," he said.
"So the potential in WA is a multi-hundred-million-dollar industry once it gets up and running, and thinking into the long term that's something that's not going away.
"Regardless if the government's emission reduction fund runs out of money, there's always going to be demand for carbon credits, and we're seeing more and more of that around the world."
Currently Queensland and NSW are leading the way in the carbon farming market, with around 150 and 200 respectively, receiving more than $800 million in carbon farming credits.
'A win for the outback', but further steps required
Pew Charitable Trusts WA outback manager David Mackenzie said it was a breakthrough for WA pastoralists in the Southern Rangelands, who had been lobbying hard to establish an industry.
However it is believed for carbon farming to reach its full potential in Western Australia, further reforms to land tenure are needed.
Under the current legislation, pastoralists like Jason Hastie from Pingandy Station are precluded from participating in the ERF.
Last year Mr Hastie delivered a petition to Agriculture Minister Alannah MacTiernan, calling for the State Government to develop a framework that would enable carbon farming across all pastoral leases in WA.
"Under the federal government emissions reduction fund, they do have a 25-year system, [so] with all the pastoral leases being renewed in 2015, there's already 21 per cent of pastoral leases that cannot participate in this current round of the ERF because our leases simply aren't long enough," he said.
"And as the years go by, more and more pastoral stations will not be able to participate in this ERF let alone a wider, more open carbon trading system."
Mr Hastie said it was critical for the State Government to address land tenure reform and native title issues for the industry to expand.
"There may be native title implications that the individual pastoralist won't have the capacity to be able to deal with the legal requirements of Native Title, so most pastoralists will need assistance with that.
"Another big thing is the methods that you can use to carbon farm — there is only one method that I'm aware of that can be used in parts of the Southern Rangelands, so the current methods of carbon farming for the outback are very limited.
"We certainly need investment in creating more methods and expanding the methods that are already out there."
Despite legislative change being a slow process, Mr Hastie said the current State Government was moving in the right direction.
"I have more faith under this government than I had under the previous government," he said.
"Without something like this carbon farming, there's not a bright future for the West Australian outback."